PMSBY extension: Low claim numbers prompts decision

The government extends the deadline for unorganised workers to access accidental death and disability insurance under PMSBY.

The government plans to extend the deadline for submitting claims under the PMSBY scheme to enable workers from the unorganised sector claim life and accident insurance. In August 2023, the Labor Ministry facilitated the registration of unorganised workers on the eShram social security portal, which has been operational since August 2021. This registration allows workers to file claims and access insurance coverage under the Pradhan Mantri Suraksha Bima Yojana (PMSBY). The scheme primarily aims to aid those affected by the coronavirus pandemic.

Current regulations state that compensation is only awarded for incidents that occurred after the initial registration in August 2021 and before March 2022. Although the claim submission deadline expired last month, the extension has been granted because many states have yet to appoint nodal officers to accept and process applications. Additionally, there is a low number of claims nationwide as many people are still unaware of the program. Between August 2021 and March 2022, approximately 270 million workers registered on the portal.

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The fundamental issue with PMSBY and similar initiatives lies in their execution. Despite the government’s efforts, the penetration of these schemes remains low in areas where they are most needed. The challenges are multifaceted, involving not only digital literacy but also infrastructural inadequacies that prevent effective communication and implementation in remote areas. To tackle these issues, experts recommend enhancing on-the-ground support by deploying trained professionals who can assist in registration and educate potential beneficiaries about their entitlements under various schemes. Additionally, collaboration with local bodies and community leaders can facilitate a deeper reach and more effective dissemination of information, ensuring that the benefits truly reach the intended recipients.

The PMSBY Scheme

Launched in 2015, the government introduced three social security schemes, including the PMJJBY and PMSBY, to provide vital financial services to citizens. These schemes target the most vulnerable sections of society, protecting them against unexpected risks and financial uncertainties. The schemes include the Pradhan Mantri Jeevan Jyoti Bima Yojana, Pradhan Mantri Suraksha Bima Yojana, and Atal Pension Yojana. Last year, Finance Minister Sitharaman reported enrolments of 16.2 crore, 34.2 crore, and 5.2 crore for PMJJBY, PMSBY, and APY respectively, as of April 26, 2023.

PMSBY offers an insurance cover of ₹2 lakh for accidental death or total permanent disability, and ₹1 lakh for partial permanent disability, applicable to individuals aged 18-70. A bank or post office account is required to receive these benefits, and participants must consent to an auto-debit for premium payments. Claims can be initiated by the registered worker in cases of disability, and by legal heirs in the event of death.

However, the scheme’s effectiveness is hindered by India’s low digital literacy rate. Many workers, often illiterate, struggle with the complex processes of accessing online portals and filling out forms. According to the Observer Research Foundation, the digital divide in India is significant, with widespread digital poverty that the government needs to address urgently.

For PMSBY to reach its full potential, proactive government measures are essential. Increasing awareness through targeted campaigns, especially in rural areas, and leveraging the eShram portal for streamlined claim processing and registration can enhance accessibility for beneficiaries.

Moreover, the success of social security schemes hinges on continuous monitoring and evaluation. Establishing a robust feedback mechanism is essential to identify bottlenecks and improve service delivery. Regular audits and assessments should be conducted to gauge the effectiveness of the schemes and to adapt strategies as necessary. This approach not only helps in refining the programs but also ensures accountability and transparency in their administration, building trust among beneficiaries and stakeholders alike.

The government has acknowledged this advice and aims to use the eShram portal as a comprehensive platform that consolidates all relevant government schemes for these workers. The portal aims to create a unified national database for the unorganised sector, including workers from various fields like agriculture, construction, and the gig economy. It records details such as name, occupation, address, educational qualifications, and skill types. To date, over 29.33 crore individuals have registered on the portal.

Currently, over 600 government schemes with a combined budget of ₹15 lakh crore are available, which complicates registration and benefit access across multiple portals. By integrating these schemes on the eShram portal, workers can easily identify applicable programs and register for them. This integration will also streamline the government’s ability to target and deliver these schemes through respective administrative ministries, maximising the use of allocated resources.